Partnership program status
A Long-Term Care Partnership policy ordinarily refers to a state-federal program that can provide Medicaid asset-disregard protection tied to a qualifying private policy. The retrieved partnership references identify the District of Columbia as an exception to states with a Long-Term Care Partnership Program. The consumer reference does not state a current date, and another 2026 commercial page contains internally conflicting language; therefore the reliable planning statement is modest: no active District Partnership Program was verified from the sources retrieved, and a buyer should ask DISB and DHCF to confirm live status before relying on asset-disregard protection (Long-Term Care Partnership overview; District LTC insurance status page).
Do not treat a policy merely called “long-term care” as partnership-qualified or as a substitute for a District Medicaid plan. The policy form, inflation protection, elimination period, benefit pool, benefit triggers, rate history, and licensing status can all affect its value. The Chapter 36 rules and current DISB materials are the right starting point for a form or insurer question (D.C. Code Chapter 36, Long-Term Care Insurance; DISB long-term-care insurance guide).
Insurance and Medicaid are separate decisions
DHCF’s 2026 long-term-care page publishes resource limits of $4,000 for one person and $6,000 for a married couple, and it describes both a Special Income Standard and medically needy spend-down. Private insurance proceeds, premium affordability, and future Medicaid treatment deserve individualized advice; an insurance purchase should not be marketed as a guaranteed way to preserve assets under District Medicaid rules (DHCF Long-Term Care overview).
Compare any proposed policy against realistic home-care and facility-care needs, ask whether the insurer is authorized in the District, and retain the outline of coverage and all replacement notices before cancelling an older policy.
Regulator: DC Department of Insurance, Securities, and Banking.
Partnership status: the retrieved sources identify the District as having no LTC Partnership Program; confirm directly with DISB/DHCF before assuming any new policy carries Medicaid asset-disregard protection (
D.C. Code Chapter 36;
Long-Term Care Partnership overview).
Federal Tax Incentives for LTC Insurance Premiums (2026)
Beyond any state-level benefit, a tax-qualified LTC insurance contract (one meeting IRC § 7702B)
carries several federal tax benefits, and a number of the relevant limits increased for 2026:
- Age-based premium deduction: eligible premiums count as a medical expense on
Schedule A (to the extent total unreimbursed medical expenses exceed 7.5% of AGI), up to 2026 limits
of $500 (age 40 or younger), $930 (41–50), $1,860 (51–60), $4,960 (61–70), and $6,200
(over 70) — all increased from 2025 (IRS Revenue Procedure 2025-32, § 4.27).
- Self-employed and business deductions: self-employed individuals can deduct 100%
of eligible premiums up to the same age-based limits without itemizing, and C-corporations can generally
deduct LTC premiums paid for employees as an ordinary business expense under IRC § 162, uncapped by
the individual age-based limits.
- Tax-free benefits: benefits from a tax-qualified contract are generally excluded
from income under IRC § 7702B(d); per-diem/indemnity contracts are tax-free up to $430/day (about
$13,079/month) for 2026 (IRS Revenue Procedure 2025-32, § 4.62).
- HSA-funded premiums: HSA funds can be withdrawn tax-free to pay eligible LTC
premiums, up to the same age-based limits above.
- New for 2026 — penalty-free retirement withdrawals: SECURE 2.0 Act § 334
lets eligible 401(k), 403(b), and governmental 457(b) participants under 59½ withdraw funds to pay
premiums on a certified LTC contract without the usual 10% early-withdrawal penalty, up to the least of
the actual premium paid, 10% of the vested account balance, or a statutory cap of $2,600 for 2026. The
distribution itself is still fully taxable as ordinary income and is not available from IRAs
(IRS Notice 2026-33).
D.C. incentive: The District's former stand-alone income exclusion for LTC premiums is gone; age-based amounts of tax-qualified premiums remain deductible only as itemized medical expenses, on top of the federal incentives above (
Got LTCi, State Tax Incentives).
State tax rules change frequently and the credit/deduction summary above is not exhaustive —
confirm current eligibility, forms, and amounts with your state department of revenue or a tax
professional before relying on any figure here.
Not mutually exclusive. Most families combine two or three funding pillars — this one rarely stands alone.
The
Journey Assessment ranks all ten pillars against your specific situation and
recommends the top three.
